China's Internet Finance Association Issues ICO Warning

An organization representing the interests of online finance firms in China has issued a warning on initial coin offerings.

AccessTimeIconSep 1, 2017 at 1:30 p.m. UTC
Updated Sep 13, 2021 at 6:53 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

A self-regulatory organization focused on online finance in China has issued a warning to its members on initial coin offerings (ICOs).

In a statement yesterday, the National Internet Finance Association of China warned that ICOs may be using misleading information as part of fundraising campaigns, urging investors to proceed with extreme caution. The group, which works with government agencies on regulatory matters, further stated its intention to toughen security measures.

The remarks further advised member companies to remain cautious when dealing with the nascent fundraising mechanism, stating:

"China Internet Finance Association members should take the initiative to strengthen self-discipline, to resist illegal financial behavior."

The announcement by the group, established by the People’s Bank of China in 2016, may not be surprising given that ICOs have been subject to strict scrutiny by the regulator.

Already, the central bank is said to be drafting regulations which may seek to suspend all ICO activity. A draft of regulatory measures for ICOs was published last week that suggested they could be classified as illegal.

It seems some domestic ICO efforts are taking note. ICO website ICOINFO went so far as to announce a temporary suspension yesterday due to the uncertainty over regulations.

The group features more than 400 financial organizations, with notable members including online lender CreditEase and financial marketplace provider Lufax.

Chinese flags via Shutterstock

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.